You Have a Collection of 200 International Stamps That You

question 9

Multiple Choice

You have a collection of 200 international stamps that you have collected over the years.Most of them cost you nothing, as you just took them off letters or postcards that you or friends and family had received.If you add up the face value (the amount printed on the stamp) , your collection totals $125.37.You recently saw a story in a local newspaper that someone else sold a similar collection of 400 stamps for $500.Which of the following statements is most likely true?

• A)The value of the collection is $250.00.
• B)The selling price of the collection is $125.37.
• C)The replacement cost of the collection is $250.00.
• D)The replacement cost - new of the stamps is $125.37.

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Definitions:

Average Net Income

The mean amount of net earnings calculated over a specified period, indicating the profitability of a business after all expenses have been subtracted from revenues.

Accounting Return

A measure of profitability in relation to various accounting measures, such as net income or assets.

Average Accounting Return (AAR)

An investment’s average net income divided by its average book value.

Return on Equity (ROE)

A measure of financial performance calculated by dividing net income by shareholders' equity, reflecting the profitability relative to the equity.